Saad Ullah
Shiba Inu cryptocurrency experiences a significant 11% price surge over two days, yet technical analysts warn of a potential death cross formation on weekly charts that could impact SHIB's short-term price trajectory.
SHIB (Shiba Inu) Price Soars 11% Amid Broader Crypto Market Revival
The past two days have brought considerable joy to Shiba Inu holders as the popular meme-inspired cryptocurrency witnessed impressive gains. Riding the wave of the broader crypto market revival led by Bitcoin (BTC), SHIB's price surged by over 11%, creating substantial green candles on its price chart.
The cryptocurrency climbed from below $0.0000125 to reach as high as $0.0000139 today, putting Shiba Inu back in news headlines and at the center of bullish forecasts from market analysts. This significant price movement demonstrates the token's continued relevance in the volatile cryptocurrency market despite frequent price fluctuations.
Shiba Inu (SHIB) Faces Potential Death Cross Formation on Weekly Charts
However, as often happens in the cryptocurrency space, positive developments rarely come without potential concerns. Technical analysts have identified a looming threat for SHIB in the form of a death cross pattern emerging on its weekly price chart.
For those unfamiliar with the term, a death cross is a technical pattern that forms when a shorter-term moving average crosses below a longer-term moving average, often considered a bearish signal by market technicians. In SHIB's case, the concerning indicators are the 23-day and 50-day price curves that appear to be converging toward a crossover point.
While these moving averages have not yet crossed, the potential formation of this pattern could increase the risk of a short-term decline for the Shiba Inu token. This technical development warrants close attention from SHIB traders and investors looking to navigate the coming market conditions.
Previous SHIB (Shiba Inu) Death Cross Led to Volatility and Eventual Rally
This wouldn't be the first time SHIB has faced such a technical pattern. The last occurrence of a death cross for the meme coin was in October 2024, providing some historical context for potential outcomes. Following that technical event, SHIB experienced a significant decline of 18.4% within a single week, demonstrating the pattern's potential for triggering short-term selling pressure.
What's particularly interesting about the previous instance, however, is that the decline was followed by a dramatic reversal. After the initial drop, Shiba Inu embarked on an impressive 54% bull rally in the very next week, eventually establishing a local high of $0.00003343 in December.
Shiba Inu (SHIB) Investors Face a Complex Market Scenario
The historical precedent creates a complex situation for current SHIB investors and traders. While the potential death cross does carry the risk of a painful short-term drop in price, history suggests it doesn't necessarily preclude a scenario where SHIB subsequently rallies to establish new, higher price levels after any initial sell-off.
This dual possibility highlights the notorious volatility of cryptocurrency markets and the challenges of relying solely on technical patterns for trading decisions. For SHIB holders, the current situation may require heightened vigilance and consideration of both potential downside risks and subsequent recovery opportunities.
The coming weeks will be critical in determining whether the death cross pattern fully materializes and, if so, whether history repeats itself with an initial decline followed by a stronger recovery, or if different market dynamics prevail this time around. With SHIB's current price momentum and the broader crypto market's revival, these technical developments add another layer of complexity to trading the popular meme coin.
Saad Ullah
